Marie Sapirie of Tax Analysts has an excellent piece about how the IRS offshore account enforcement program treats the thousands of ordinary Americans abroad — and many green card holders living in the U.S. — as presumptive tax criminals when they try to remedy foot-fault paperwork violations in reporting offshore accounts. She tells the stories of four “minnows” who tried to remedy inadvertent minor violations of the foreign account rules. Get a load of the advice they gave “Taxpayer 3:”

The taxpayer, like many others, sought help from a congressional representative in reaching a satisfactory resolution with the IRS. The response that the lawmaker received from the IRS — that the taxpayer could renounce U.S. citizenship — was disappointing. “I lived in the U.S. for 30 years; I never was treated unfairly for 30 years. I was proud of it. And here the IRS is telling me to renounce my citizenship because it may be the best solution considering my situation,” the taxpayer said.

When the IRS is telling people to expatriate themselves, something is very wrong.

The article discusses the headaches involved in clearing up FBAR reporting, including the delays caused because IRS agents aren’t allowed to make international phone calls.

The IRS should imitate programs for state non-filers for FBAR violations: allow taxpayers to come in penalty-free anytime if they file disclose their accounts and amend returns for five years back to report any unreported offshore income. Time to stop shooting the jaywalkers.

Rashia Wilson may have duped the IRS out of as much as $20 million before her arrest on stolen identity refund fraud charges.

That’s according to a court document, filed in advance of her sentencing today, that estimates the government’s loss at $7 million to $20 million.

What kind of criminal mastermind could break through the internal controls at IRS to loot that kind of money?

“YES I’M RASHIA THE QUEEN OF IRS TAX FRAUD,” reads a May posting on her Facebook page described in the affidavits. “IM’ A MILLIONAIRE FOR THE RECORD SO IF U THINK INDICTING ME WILL BE EASY IT WONT I PROMISE U!”

Well done, Shulman! Criminal masterminds like Ms. Wilson are robbing the Treasury of $5 billion annually, and you are busy telling taxpayers trying to come into compliance to renounce their citizenship.

Tax Justice Blog, North Carolina Facing Disastrous New Tax Laws. The “disatrous” changes include reduction of the individual rate to 5.75% (currently 7.75%) and the corporate rate to 5% (from 6.9%). If that’s a disaster, here’s hoping for one in Iowa.

This entry was posted
on Wednesday, July 17th, 2013 at 8:31 am and is filed under Tax Roundup.
You can follow any responses to this entry through the RSS 2.0 feed.
You can leave a response, or trackback from your own site.

What is wrong is not the IRS recommendation to renounce, but rather the politics which created this situation, the politics which allow it to persist and the unwillingness of stateside Americans to do anything about it. Stateside Americans can only be ashamed and disgusted with their own inaction.

I agree it is shameful. To be fair, I’d be surprised if one in 100 stateside Americans has a clue about FATCA, FBAR and the tax headaches of Americans abroad. How would they know? Trayvon Martin, after all…